Business incubator leaves Raleigh-owned building

The financially troubled Raleigh Business and Technology Center has moved out of its city-owned building near downtown, and the agency’s leaders aren’t sure of their next steps.

City officials have been trying to evict the Southeast Raleigh business incubator since July, when a scathing audit found unexplained cashier’s checks and payments to tenants as well as records showing that the agency’s nonprofit status had been revoked. The audit also touched off a police investigation of possible fraud involving ousted director Bob Robinson; no charges have been filed.

The agency fought the eviction in court, arguing that its lease on the $5.16 million property was valid through December.

But late last month, the incubator decided to stop fighting the eviction order and leave the building. The city took possession of the property Oct. 1 and is assessing maintenance needs. Existing small-business tenants have been allowed to stay until Raleigh leaders develop a long-term plan for the property.

“It’s not because the city was successful in kicking them out,” the agency’s attorney, state Sen. Dan Blue, said Tuesday. “They figured it was cheaper for them to find the space elsewhere.”

The incubator has had the building rent-free since it was built in 2000. But if it had lost the lawsuit, it would likely have had to turn over revenues earned from small-business tenants. The agency paid a $22,222 bond to cover that amount during an August court hearing.

The move leaves the agency without office space to offer minority-owned startup businesses – one of its core functions. It also canceled the Pacesetters program, a weekly class for business owners, after running out of money to pay the instructor.

Two remaining employees

Interim director Miriam Perry has left the organization, leaving two longtime staff members as the only remaining employees. They are continuing to oversee a small-business loan program and a few contract services from a temporary location between Raleigh and Garner; they wouldn’t say exactly where the new space is located.

Lawrence Wray – the former Raleigh assistant city manager who is chairman of the agency’s board – says he doesn’t know what services the Raleigh Business and Technology Center will offer in the future.

“We’re not sure yet, and that’s what we’re trying to work through,” he said.

The bulk of the organization’s funding came from a $162,000 annual grant from the city and rent revenue from offices at the South Wilmington Street building.

The building is mostly empty now, with a few remaining tenants having negotiated six-month lease extensions with the city. Raleigh leaders are working on details for a new business incubator program at the site.